Crushed it 🔥
Cloud consolidation, venture raises, and a good day in markets.
Hi 👋, Tanvi here.
Filter Coffee hits your inbox every morning with notable tech and business news scoops to jump start your day.
Sign up below for free. 👇
Let’s go ahead and get started:
Market summary: 📊
Resounding comeback in the Indian markets yesterday, with good earnings bolstering sentiment. US investors returned from a 3 day weekend to take tech stocks even higher.
US:
S&P 500 - up 0.81%
Nasdaq 100 - up 1.50%
India:
Nifty 50 - up 1.68%
Sensex - up 1.72%
What’s poppin’ ☕
✅ Gormint has spoken—the ministry of Electronics and IT sent a strong worded letter to the CEO of Whatsapp regarding the privacy policy changes, asking the company to roll changes back. GOI’s leverage? We have the largest base of Whatsapp users. Obviously governments meddling in business is bad, but we’re thinking the government is using this opportunity to send a message to ALL big tech companies that they’re watching all their moves, including the blanket ban on Trump, and that no funny bizniss around here will be entertained.
Also, we don’t need to highlight our track record of banning stuff, so...
✅ Hello Mr. President—Joe Biden will be inaugurated this noon as the 46th President of the United States. Joe’s expected to run from the podium right into the Oval Office, sign off on a $1.9 trillion economic stimulus package, and a series of executive orders easing immigration, policing, healthcare, to other social issues.As expected, a sour Trump won’t be there to receive him nor will Melania help the Bidens move into the family quarters, a tradition that departing Presidents and First Ladies have graciously followed for centuries.
Old guard’s transformation 🖥️
Citrix, the old school software giant, is spending $2.2 billion on buying a glitzy SaaS platform called Wrike, which sells an IT project management software.
Some context—it's no secret that the old guard, basically software companies from the yester-era, are facing disruption from the nimble, cloud hosted tools sold as subscription services. Many have pulled off hard transformations, Like Microsoft or Adobe, tuning and moving major components of their offerings to the cloud, while the others have mostly lagged behind.
The ones still sleeping or trying to pull off a half-assed transformation are now suddenly staring at a death sentence, as COVID-shocked IT budgets leave little room for software that is not remote friendly.
Growth for vendors like Citrix across all verticals is declining, with 5.28% growth for 2018 and pitiful 1.23% for 2019. They hope that buying out the “new” kids on the block will help boost revenues.
Anyway, Wrike gives Citrix access to 40K+ new customers that use Wrike’s product, expanding its distribution capabilities into verticals from healthcare to advertising, which Citrix can capitalize on in due time. Wrike competitor Asana is trading at $6 billion, so this deal is kind of a steal for Citrix.
Bottomline: old school software vendors are desperate to make a dent and secure themselves against disruption. Expectations are widely set for more acquisitions and deals like this play to out in 2021.
SaaS fires continue—this time with HR-tech ☁️
SaaS startup Darwinbox, which sells cloud based HR tools, scooped up $15 million from Salesforce’s investment arm. This will be the first investment Salesforce has made in India—kinda surprising for a company that’s been at the front of the cloud revolution.
No valuation tag was disclosed, but we’re easily thinking $100M+ based on previous levels the company had raised at. Existing investors Sequoia Capital India and Lightspeed India chipped in too.
The startup’s rise has been quite amazing—in under 5 years, they’ve scaled to serve over 500 enterprise customers, across 60 countries, nearly doubling that number in the past year alone. Revenues meanwhile are growing 300%+ rates over the last 12 months.
Obviously COVID’s been a blessing to these businesses—with a hard shift to remote work demanding more nimble employee management software. Darwinbox is now looking to further improve its offering, leveraging the power of AI to offer adjacent products.
Bottomline: 300%+ growth rates are stupendous. The aggression with which some of these cloud-tools emerging out of India are growing, is putting category leading global platforms to shame. Bravo!
And then turning to another hot category,
Hyperlocal delivery startup, Dunzo got another $40 million from a barrage of new and existing investors including Google, Lightbox, Evolvence and others.
With lockdowns forcing people to shelter in place, delivery businesses are coming off of a hot year here. Dunzo reports a 2x bump in volumes relative to the previous year, now clocking in GMV north of $100 million. Last 6 months have been critical to expansion—in addition to doubling down in key markets like Mumbai, Chennai, Pune, the company has expanded to 8 of total cities, and is optimizing to service orders in under 30 minutes.
What matters: $40 million is good amounts of fuel in the tank, for now, to keep streamlining operations and achieve scale. But the hyperlocal delivery space is brewing with the competition, with the likes of Flipkart, Amazon, and even Swiggy looking hot. Odds are, Dunzo will need to raise some more pretty soon.
Closing out—Netflix investors can now chill 📈
Netflix, the darling stock of the lockdowns, showed the market that it still got the mojo. For the December quarter of 2020, the company added 8.5 million new PAID subs, vs. 6 million that everyone was expecting. Stock quickly popped 13% on the update!
Here’s a quick look:
Revenues up 22%, to $6.6 billion for 3 months
Total subscribers now over ~203 million
Expects 6 million more subs for first 3 months of 2021
To think that 8 million new subscribers would fish into their wallets to pay for a $10/month for the service on average, in the middle of a recession year, highlights the mass appeal and power of their platform. Moreover, the distribution engine they have built is just crazy—Queen’s Gambit for example got 62 million views in under 3 months.
That damn chart just keeps going up:
The momentum is not expected to slow down—despite competition picking pace, operating with the leverage of 200 million paying subscribers behind your back tilts the game completely in your favor.
Investors, addicted to the juice, are now demanding more monetization—like sports, live TV, and such. Sabka number ayega!
What else are we snackin’ 🍿
👏 Indian-Americans pack Biden’s office - Uzra Zeya becomes the latest to be nominated to a key state department position, as Under Secretary for Civilian Security, Democracy, and Human Rights by Joe Biden. A seasoned diplomat, Uzra had quit the foreign service in 2018 in protest against the policies of Trump.
👩✈️Female pilots make history - Flight Lieutenant Bhavana Kanth is set to become the first female fighter pilot to participate in the Republic day Parade this year. Kanth is also one of the first women fighter pilots ever in the IAF.
Hit that 💚 if you liked today’s issue.
You can forward this email or share FC on social media by clicking the button below. Thanks and Ciao! 😀